BP Energy Company v LOLA Energy PetroCo LLC

Holding The Appellate Division affirmed the preliminary injunction enjoining the defendant from distributing encumbered proceeds, finding that the plaintiff demonstrated a probability of success on the merits, irreparable harm due to unauthorized asset transfers, and a favorable balance of equities. The court noted that the injunction merely enforced existing contractual restrictions against distributions during default.

The court’s words

granted plaintiff's motion for a preliminary injunction enjoining defendant LOLA Energy PetroCo LLC from making distributions of encumbered proceeds

2026 NY Slip Op 06569, at the official text

plaintiff demonstrated "a probability of success on the merits, danger of irreparable injury in the absence of an injunction and a balance of equities in its favor"

2026 NY Slip Op 06569, at the official text

LOLA had undertaken an actual distribution of $4.52 million in encumbered assets and downstream transfers without plaintiff's consent

2026 NY Slip Op 06569, at the official text

directed LOLA to do nothing more than it was already required to do under the terms of the agreements

2026 NY Slip Op 06569, at the official text